ECONOMIC INTEGRATION & EUROPEAN UNION

PRESENTED BY LAVINA

NACHLANI - 68

WHAT IS ECONOMIC INTEGRATION ?

Economic integration can be defined as a kind of arrangement where countries get in agreement to coordinate

and manage their fiscal, trade, and monetary policies in order to be mutually benefitted by them.

KINDS OF ECONOMIC INTEGRATION

FOUR KINDS (STAGES) OF ECONOMIC INTEGRATION

FTA (free trade area): – no internal tariffs among members, but each country

imposes its own external tariffs to the third country.– NAFTA (North America Free Trade Agreement– AFTA (ASEAN Free Trade Area)– EFTA (European Free Trade Area)

Customs union: – no internal tariffs and common external tariffs, uniform

commercial policy formed jointly– Mercosur (Southern Common Market), – CACM (Central American Common Market)

FOUR KINDS (STAGES) OF ECONOMIC INTEGRATION

Common market: – free movement of products and factors

(resources), which is customs union plus factor mobility

– EU (European Union – previously EEC) Economic union:

– common market plus common currency – coordination of fiscal and monetary policy– EMU (Economic and Monetary Union)

ECONOMIC INTEGRATION

BENEFITS

Progress in trade.

Ease of agreement.

Improved political cooperation.

DRAWBACKS

Creation Of Trading Blocs

Trade Diversion

National Sovereignty:

EUROPEAN UNION

What is the EU ?

A “family” of 27 European countries

Shared values: liberty, democracy, respect for

human rights and fundamental freedoms, and the

rule of law.

Largest economic body in the world.

World’s most successful model for advancing

peace and democracy.

A unique institution – Member States voluntarily

cede national sovereignty in many areas to carry

out common policies and governance.

World’s most open market for goods and

commodities from developing countries.

27

7

30

490million

Member States

Combined population of

EU Member States

Percent of world’spopulation

Percent of global GDP

55Percent of combined

worldwide OfficialDevelopment Assistance

EUROPEAN UNION

The EU HEADQUARTERS

Brussels, Belgium

Selected as the headquarters of the European Union because of its centralized location in Europe.

 

ORIGIN OF THE EU

First successful regional organization (1957) European Economic Community (EEC)

EEC became European Community (EC) (1986)

EC became European Union (EU) (1993)

STRUCTURE OF THE EUROPEAN UNION

EuropeanEuropeanParliamentParliament

EuropeanEuropeanCommissionCommission

CouncilCouncilof Ministersof Ministers

EuropeanEuropeanCouncilCouncil

CourtCourtof Justiceof Justice

The EU is run by five institutions, each playing a

specific role:

European Parliament – elected by the peoples of the Member States

Council of the Union – composed of the governments of the Member States

European Commission – driving force and executive body

Court of Justice – compliance with the law

Court of Auditors – sound and lawful management of the EU budget

OBJECTIVES OF THE EU

Its principal goal is to promote and expand cooperation among member states in economics, trade, social issue, foreign policy, security, defense, and judicial matter.

• EU has sought out to meet its objective in three ways:

1. By defining a common commercial policy.2. By reducing economic differences between its richer

and poorer members.3. By stabilizing the currencies of its members.

Elimination of custom duties, quantitative restrictions with regard to export & imports.

Establishment of a common custom tariff & commercial policy.

Abolition of all obstacles for movement of persons, services & capital.

Application of programmes in order to coordinate the economic policies.

ACTIVITIES OF EU

The €uro

In 1999, the euro area was established as a currency in

eleven of the then fifteen EU Member States.

Of the 27 EU Member States today, fifteen have adopted

the euro.

One of the striking benefits of a single European currency

are low interest rates due to a high degree of price

stability.

The euro is as stable and credible as the best-performing

currencies previously used in the euro area countries.

€

€

€

€

The European Central Bank (ECB) is the central bank

for Europe's single currency, the euro.

The ECB’s main task is to maintain the euro's

purchasing power and thus price stability in the euro

area.

The euro area comprises the 15 European Union

countries that have introduced the euro since 1999.

The ECB operates independently from Member State

governments.

The euro was introduced in 1999

EUROPEAN CENTRAL BANK

ADDRESSING GLOBAL CHALLENGES

Peace & Security– Works for global peace and security alongside the United

States and multilateral organizations – including NATO and

the United Nations.– Undertakes humanitarian and peacekeeping missions and has

provided military forces for crisis management around the

globe.

Counterterrorism & Homeland Security– Taken steps to improve intelligence sharing, enhance law

enforcement and judicial cooperation, curtail terrorist

financing.– Boosts trade and transport security to support the struggle

against terrorism.

Democracy & Human Rights– Works globally for free elections and open

democratic processes.– Fights racism and intolerance at home and abroad.– Campaigns globally against capital punishment.

Development Assistance & Humanitarian Relief– The EU and its Member States are the world’s

largest aid donor, providing 55% of total official

development assistance. – Provides billions of dollars in humanitarian aid to

more than 100 countries in response to crises and

natural disasters.

ADDRESSING GLOBAL CHALLENGES

Environmental Protection

– A leader in global efforts to protect the

environment, maintaining rigorous and

comprehensive systems at home.

– Plays a key role in developing and

implementing international agreements, such

as the Kyoto Protocol on Climate Change.

– Executing a “cap and trade” system to reduce

greenhouse gas emissions

– Takes the lead in the fight against global

warming with the adoption of binding energy

targets (cutting 20% of the EU’s greenhouse

gas emissions by 2020).

ADDRESSING GLOBAL CHALLENGES

AGRICULTURE

CAP – Common Agricultural Policy

GREEN RATE – support price is converted into national price at the Green Rate

Free movement of Agricultural products from one country to another.

EEC has achieved self – sufficiency in Agriculture.

FISHERIES - CFP – Common Fisheries Policy

Conservation of fish stocks

Aid to fishing industry to cope with changing circumstances

Monitor supply and demand for fish

Negotiate with non-EU members on fishing issues

THANK YOU